Energy vs. Environment

By Bill RichardsBy Bill RichardsJanuary 10, 1977

The flow of crude oil from Alaska isn't scheduled to be raising serious questions here about whether federal and state energy demands can coexist with the new set of tough environmental laws that West Coast states have passed in recent years.

Like an irresistible force meeting an immovable object, oil and environment are clasing up and down the Pacific coast. Lawsuits testing how far environmental regulations can go in controlling Alaskan oil-related developments have been filled in California and the state of Washington, with experts predicting additional legal tests.

Since 1969, when the issue of environmental protection was first raised at the state level after disastrous oil spills in the Santa Barbara channel, states like California and Washington have put through increasingly stringent Jaws governing everything from coastal development to air quality. Many experts here see the Alaskan oil arrival as the first serious broad-based challenge to those laws.

For example, a representative from Texas appeared at a federal hearing in Los Angeles last week to accuse California of acting against the national interest in withholding apporval of an Alaskan oil pipeline terminal here on environmntal grounds.

Also, officials of Solano County, a small rural county east of San Francisco, charge that those who want to retain tight air quality was standing in the way of a $500 million Alaskan oil petrochemical complex being built in their county are selfish. Installation of the complex would boost the county's protery tax revenues 45 per cent and enable it to replace its 1906 county jail - and lower property taxes for its 195,000 citizens, it is projected.

"It's like a number of railroad trains all coming together at once on a single switch point," said William Arntz, regional administrator for the Federal Energy Administration in San Francisco.

Arntz and a number of other officials and environmentalists believe the state laws will ultimately give way to the combined pressure of energy needs and economic growth.

Many of the laws were passed, they point out, during the late 1960s and early 1970s when problems such as fuel shortage and unemployment were not as pressing as they are now. California's unemployment now is a chronic 10 per cent and state officials are becmong increasingly obsessed with the need for additional fuel supplies as the state's allotment of natural gas runs out.

"California passed some tough laws," Arntz said. "Now it's going to have to face some hard realities. I think the state is going to - and is prepared to - make some very important environmental tradeoffs."

The most heavily publicized conflict between oil and environmental has taken place at Long Beach Standard Oil of Ohio (Sohio), with the informal backing of many senior FEA officials, is seeking to construct a pipeline terminal there to receive Alaska oil shipments.

Under Sohio's proposal, the terminal would pipe the oil from a estimated 18 to 20 supermakers per month docking at Long Beach to Midland, Tex., where it would be diverted north into the Midwest where it is needed.

California Gov. Edmund G. (Jerry) Brown Jr. and Tom Quinn, head of the state's AIr Resources Board, oppose the plan. They claim it would violate state air quality laws and further foul the already polluted air over the Los Angeles basin.

Sohio which ows or controls more than half of the 9.5 billion-barrel North Slope oil reserves in Alaska, says it has no other way to move its oil to the Midwest except by costly supertanker shipments around South America or via smaller tankers through the Panama Canal.

The company recently offered an unusual tradeoff to the state. Under it, Sohio would purchase a polluting facility in the Long Beach area and destroy it in return for permission from the stae for the pipeline terminal. So far state officials have rejected the offer.

Quinn has suggested that Sohio would have a better chance if the company tried to put its terminal on a less-polluted portion of the California coast. However, environmentalists who support the state's strong coastal protection law say they will strongly oppose the oil company if that happens.

A more likely solution, some state officials believe, is an eventual tradeoff, with the state getting additional federal, natural gas allotments in return for granting the oil company the right to build the Long Beach terminal.

Some state officials and environmentalists also believe thestate will ultimately compromise with the Dow Chemical Co. Dow is seeking to override state of air quality laws for a proposed $400 million petrochemical complex in rural Collinsville. If that project is successful, it is likely to trigger an attempt at an even larger Alaskan oil-related complex by the Atlantic Richfield Co.

Dow needs 65 permits from public agencies to get started. But the Bay Area Air Pollution Control District, Area Air Pollution Control District, which includes Solano County where the complex is planned, has turned down the project. Environmentalists and state officials are closely watching to see if Dow is able to show enough corporate muscle to overcome the rejection.

The state of Washington, which is being considered as the locale for another Alaskan oil port, has already lost one battle over its environmental laws. A three-judge federal panel, acting on a suit brought by Atlantic Richfield last September struck down a state statute that would have allowed state officials to limit the size of Alakan-oil bearing supertankers entering Puget Sound. The decision is being studied by the state for appeal to the U.S. Supreme Court.

Washington's Shoreline Management Act. passed in the early 1970s to govern development on the state's lengthy coastline, is likely to be challenged soon. Shell Oil, Mobile and Texaco have made plans to expand their Puget Sound refineries to accommodate Alaskan oil shipments. The expansion would violate the 1971 act and bring lawsuits from the oil companies, state officials believe.

A third suit is in the making over a plan by the Northern Tier Pipeline Co. to locate a terminal for a 1,500-mile oil pipeline from the Midwest to the Puget Sound tanker terminal at Port Angeles. Opponents claim it would violate the state's siting act and are preparing a suit to stop the state from granting the pipeline company the required permit.

Washington's official position on plans to link the state to Alaskan oil shipments was spelled out last year in the state's coastal zone management program drawn up under the-Gov. Dan Evans and approved last year by Commerce Secretary Elliot L. Richardson.

The program said: "The state is not interested in becoming a major petroleium processing center or transportation terminus for a major new pipeline to the Midwest."

In the view of some state officials and environmentalists, however, that position is likely to be somewhat modified under Washington's new governor, Dixy Lee Ray. During her campaign last fall Ray advocated strong controls on the development of facilites related to Alaskan oil. But the new governor favors those facilites.

"What is hapenning," Brucker said, "it that laws put on the books to protect the coastline are all of a sudden interfering with the plans of the big oil companies. I think you're going to see a lot of changes to those laws as things develop."